Pro Tips for Buying a Car in Caledonia
Pro Tips for Buying a Car in Caledonia
Posted on September 29, 2021
If you are in the market for a new vehicle in Canada right now, these tips for buying a car will help you get a great deal. The vast majority of Canadians, myself included, need to get auto financing to purchase a new car.
With that in mind, we asked our Caledonia car loans team to provide some insider tips to help us with that new car purchase.
The internet is a wonderful tool but most consumers suffer from analysis paralysis due to information overload. We can help with that.
What can you afford?
We would all love to drive the latest luxury car but that is not feasible for the majority of us out there. What you should do is determine what you can afford comfortably so you do not end up car poor.
How much debt are you carrying?
Start by jotting down all of your financial obligations from rent/mortgage, utilities, credit cards and groceries.
Once you have worked out that number, then take it and divide it by your monthly income. This would give you a balance of how much money you have left over after settling your debts.
If you do not have a substantial amount of money left over after working out these sums, then you should consider not buying a car until you have paid down your debts.
Avoid getting in over your head
If you have a significant amount of money in your budget then you can start shopping around online for auto financing to determine what you can afford.
What most prospective car buyers do is first look for a car they love then try to get financing.
The issue with that approach is that you could end up selecting a vehicle that is beyond your budget. Finding out the maximum amount you can borrow will help you refine your search.
Give yourself some credit
Arguably the most important thing that Caledonia auto loan providers look at when assessing prospective customers is their credit score. Your credit score is a 3 digit number that will determine whether you will qualify for an auto loan and at what interest rate.
The importance of being proactive with your credit
You should make it a regular practice to check your credit report regularly. There is no cost to do this and it helps protect you from having your credit score negatively impacted.
The government of Canada has mandated that credit reporting agencies must correct any errors in a consumer's credit report. Use Equifax Consumer Credit Report Update or TransUnion credit investigation request if you find errors.
How to get a high credit score
Paying your bills on time is the most effective way to boost your credit score. You can set reminders to pay your bills so you never miss a payment.
Missed payments are one of the most common reasons that consumers have poor credit so don’t let it happen to you.
Keeping your debt levels low, is another way to help drive up your credit score. Consumers that carry large balances on their credit cards are considered at higher risk than those who do not.
Industry experts recommend keeping your debt level at 35% or lower. Lower is always better.
Selecting the right auto finance company in Caledonia
If you have a good credit score and verifiable income, you can turn your focus to looking for a great finance company to help with your new car purchase.
Our auto loans team have the skills and experience to deliver.
Cheaper isn’t always better
While you may be tempted to pick the lender with the lowest interest rates as a knee-jerk reaction, this is not recommended. Sure, we all want to save money but give some thought to the customer service experience.
You want to have peace of mind knowing that the lender you are dealing with is going to provide world-class customer service whenever you have a question about your auto loan.
These pro tips for buying a car are going to give you the upper hand when looking to buy a new car, now that you know what steps to take you can now begin searching for the car of your dreams!
When you’re ready for a car lease or loan, get in touch with the Caledonia auto loan experts at Northway Ford for great deals on auto finance.